Citing the "historic drop in travel demand and the expected slow pace of recovery," Hyatt has just issued a statement explaining that it will be laying off 1,300 of its employees around the world, beginning June 1, 2020, and restructuring the company's global corporate operations.
As the far-reaching effects of the pandemic on the hospitality industry have become more visible, said Hyatt, it has become apparent that further cost-cutting steps are needed to keep the company on its feet.
"COVID-19 has thrown our industry into unknown territory," said Mark Hoplamazian, President and Chief Executive Officer of Hyatt. "While parting ways with our colleagues is excruciating, we must be sensitive to commercial realities so we can continue to fulfill our purpose of care over the long term-through this pandemic and for what lies beyond. Our goal is to emerge from this crisis with strength, and ultimately position our business and our world-class teams for when the hospitality industry rebounds, and when our guests and customers once again choose Hyatt."
Hyatt's losses for the first quarter of 2020, reported last week, proved to be wider-than-expected, reported Reuters, and the hotel chain subsequently suspended its dividend and share-buyback program.
Since the pandemic began to escalate back in March, Hyatt has taken action to reduce expenditures company-wide, trimming the salaries of its Senior Leadership Team and Board of Directors, cutting pay and schedules for two-thirds of its U.S. corporate employees, and furloughing an unspecified number of hotel team members. That the hotel giant had 55,000 employees at the close of 2019, per Refinitiv Eikon data.
The company did note that those who are laid off will be eligible for severance pay, benefits commensurate with their years of service and outplacement services. Former colleagues who find themselves in dire financial straits can also apply for assistance from the Hyatt Care Fund, which was established to help Hyatt's people who might be struggling with rent, utilities, groceries or medical bills.
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